More people are beginning to see the potential in Chinese stocks and would love to piggyback on the growth of China.
Some investors remain skeptical and see Chinese stocks as fraudulent as a whole. It is okay. We are entitled to our views.
Well, this article is for meant for the former camp so be sure to read on…
Chinese companies can list in various exchanges and it can be confusing with terms such as A shares, H shares and US ADRs.
Below is a table from FTSE Russell which categorizes the Chinese stocks very well:
Foreign investors can invest in most of these shares all along, with exception of A shares.
For a long time, only PRC locals could get their hands on A shares and some of the foreign institutions who were approved to do so.
But as China is opening up its capital markets overtime, a significant milestone happened on 17 Nov 2014 when A shares were available for foreign individual investors (like you and me) for the first time.
This is made possible via the Shanghai-Hong Kong Connect and the Shenzhen-Hong Kong Connect. Simply said, individual investors are using Hong Kong as a conduit to access the Shanghai and Shenzhen stock markets. I suspect it is because Hong Kong has all the infrastructure to support international investors and this would be the fastest arrangement to get A shares on the global stage.
Fast forward to today, there are about 4,500 stocks listed in Shanghai and Shenzhen that are eligible for foreign investors and the lists of stocks can be found here.
Which brokers to use?
The thing is, not all brokers offer A shares access and I often get the question on which brokers to use.
Here are some brokers you can consider if you are based in Singapore.
#1 POEMS
The good old POEMS which you probably already have a trading account with. You can use it to buy A shares without the need to hunt for another broker. I primarily use POEMS to buy A shares. This is because POEMS was my very first broker when I first started investing and there are no compelling reasons to change.
POEMS charges a commission of 0.25% for A shares with a minimum commission of ￥88 (~S$18). But if you use their Cash Plus Account, you get lower fees as stipulated below:
| Amount of assets in the account | Commission rate | Minimum Commission |
| S$0 to $29,999 | 0.15% min | ￥80 (~S$16) |
| S$30,000 to $249,999 | 0.12% min | ￥60 (~S$12) |
| S$250,000 and above | 0.08% min | ￥50 (~S$10) |
Note that there would be an account fee of S$15 per quarter but would be waived if you have made one trade in that quarter (how hard can that be?). Accounts with more than S$250,000 have this account fee waived totally.
Also, there would be the usual custodian fee of S$2 per counter per month. This can also be waived if you make 2 trades per month or 6 trades in a quarter.
You can use this link to sign up for an account or use our referral code: LEJ.
#2 Tiger Brokers
I have done extensive reviews on Tiger Brokers – see little capital, comparison and 7 tools.
It is the cheapest broker you can get in Singapore and it offers access to China A shares.
Tiger Brokers charges 0.06% commission or a minimum commission of just ￥15 (~S$3)!
There are no account maintenance fee or custody fees.
You can use this link to sign up for an account or use this referral code: DRWEALTH.
#3 Saxo
I don’t have an account with Saxo but I was told that it offers China A shares. I quick search shows that indeed it supports both Shanghai and Shenzhen markets.
Saxo has also offers a tiered pricing depending on the amount of funds you have in the account.
| Amount of assets in the account | Commission Rate | Minimum Commission |
| Min. initial funding: S$3,000 | 0.15% | ￥40 (~S$8) |
| Min. initial funding: S$300,000 | 0.10% | ￥30 (~S$6) |
| Min. initial funding: S$1,500,000 | 0.08% | ￥20 (~S$4) |
Saxo charges custody fees of 0.12% p.a. and it can be lowered to 0.06% if you are at the highest tier (>S$1.5m account size).
#4 UOB Kay Hian
UOB Kay Hian offers A shares trading at a commission rate of 0.25% with a minimum commission of￥80 (~S$16).
There’s the usual custody fee of S$2 per counter per month and would be waived if you make 2 trades per month or 6 trades in a quarter.
#5 Maybank KE
I only see Maybank KE offering Shanghai stocks and not Shenzhen in their list of offering. It is best to check with them if you are a client.
The commission is similar to UOB Kay Hian – commission rate of 0.25% with a minimum commission of￥80 (~S$16).
Maybank KE also charges the usual custody fee of S$2 per counter per month and would be waived if you make 2 trades per month or 6 trades in a quarter.
#6 Lim & Tan
Lastly, Lim & Tan offers Shanghai stocks only under their list of supported markets. The commission rate is 0.25% with a minimum of￥88 (~S$18).
There’s also a custody fee of S$2 per counter per month and would be waived if you make 2 trades per month or 6 trades in a quarter.
Conclusion
Not all brokers offer access to China A shares and we cannot assume that a broker with access to Hong Kong market would offer A shares trading. For example, Interactive Brokers and FSMOne do not offer A shares at this point in time.
Some brokers like Maybank KE and Lim & Tan only offer Shanghai markets but not the Shenzhen stocks. So it is important you check with your broker.
Below is the list of brokers that offer China A shares trading and their corresponding fees. Which one would you use?
| A Share Markets | Commission | Min. Commission | Custodian Fee | Platform Fee | |
| Tiger Brokers | SH and SZ | 0.06% | ￥15 | Nil | Nil |
| POEMS | SH and SZ | 0.08% to 0.15% | ￥50 to ￥80 | S$2 per counter per month | S$15 per quarter |
| Saxo | SH and SZ | 0.08% to 0.15% | ￥20 to ￥40 | 0.06% to 0.12% per annum | Nil |
| UOB Kay Hian | SH and SZ | 0.25% | ￥80 | S$2 per counter per month | Nil |
| Maybank KE | SH only | 0.25% | ￥80 | S$2 per counter per month | Nil |
| Lim & Tan | SH only | 0.25% | ￥88 | S$2 per counter per month | Nil |
A good summary, thanks!
As Tiger broker has the lowest costs, is there any reason not to use Tiger brokers?